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i ) The project analysis team incorrectly analyzed a potential project which began two years ago. The team thought the heavy equipment used in the
i The project analysis team incorrectly analyzed a potential project which began two years ago. The team thought the heavy equipment used in the project would last for years with positive cash flows in all years but it is now clear that the life of the equipment is only years. The project's year cash flows are fine, but management has decided to shutter the project at the end of years rather than replace the equipment and continue the project for the final years.
ii Due to a very lucky miscalculation by the marketing folks, demand for your project's products has increased in the early years of the project, but that reduced sales from future years. The same total inflows were achieved, but the timing was more frontloaded than anticipated.
iii That same team of marketing folks was looking at another project. For that one, they projected cash flows of $ per year for years. Unfortunately, that same $ in total cash flows looks like it will be spread out over years instead.
e Your firm is looking at three mutually exclusive projects. Describe how you would decide which projects to accept, be very clear on which capital budgeting techniques you would use and how you make your decision. pts The lecture notes cover this one, review as needed.
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